OPEC output up in June on Iraqi export freeze

The 10 OPEC countries in the cartel's output quota system raised production by 135,000 barrels per day (bpd) in June to offset an Iraqi export freeze, the Middle East Economic Survey (MEES) said Monda

The 10 OPEC countries in the cartel's output quota system raised production by 135,000 barrels per day (bpd) in June to offset an Iraqi export freeze, the Middle East Economic Survey (MEES) said Monday, July 16.

The industry newsletter said the cartel's overall output, excluding OPEC member Iraq which is exempted from the quota system because of an 11-year-old embargo, rose to 24.995 million bpd in June compared to 24.86 million bpd in May.

The agreed OPEC quota allocation from the start of April 1 stands at 24.201 million bpd. "As a result of the suspension of Iraqi oil exports, which opened up a window of opportunity for the other producers to substitute their crudes for the missing Iraqi barrels, the OPEC 10 continued to increase their production beyond their allotted quotas in June, as they did in May and April," MEES said.

Iraq suspended its UN-supervised shipments of 2.2 million barrels a day on June 4 in protest at a US-backed British plan to impose "smart" sanctions, a project shelved at the UN Security Council last week because of Russian opposition.

Resumed shipments follow a July 9 agreement between the United Nations and Iraq on conditions for a 150-day extension of the oil-for-food programme under which sanctions-hit Baghdad exports crude to pay for essential goods for its 22-million population.

Baghdad has been under embargo since invading Kuwait in 1990 but it also exports oil products to neighboring countries outside the UN program and smuggles out oil through the Gulf.

Iran made up the lion's share of the shortfall caused by Iraq, boosting production by 100,000 bpd to 3.75 million bpd in June, MEES said.

Among other OPEC members, "two countries were unable to raise production, Indonesia because of capacity restraints and Nigeria because of political and civil disturbances," the Cyprus-based weekly added.

The United Arab Emirates, meanwhile, has resumed normal production after a "shortfall in April and may due to scheduled maintenance of offshore facilities." —(AFP)